Furry thoughts on Sky v. Skykick – Part 1: trade marks lacking sufficient clarity and precision

The IPKat has now had some time to put its razor-sharp fangs into the Court of Justice of the European Union (CJEU)'s decision in C-371/18 Sky v. SkyKick [rapid announcement post here] and offers some furry further thoughts. The background to the case, together with an analysis of the opinion of Advocate General (AG) Tanchev, can be found here. 

Because the decision has much to offer, the analysis will proceed in two parts. This post concerns the issue of trade mark registrations suffering from a lack of clarity. A follow-up post will be dedicated to the issue of bad faith registrations in the absence of an intention to use.

The CJEU decision

The first two questions referred by Arnold J (as he then was) were whether a trade mark can be invalidated if one or more of its specified goods lack sufficient clarity and precision to enable third parties to determine the extent of protection sought. The referring court wondered if specifications like "computer software" might be so general, and potentially cover so many different goods, that they may not be compatible with the trade mark's function as an indication of origin.

The CJEU held that the list of absolute grounds of invalidity provided in Directive 89/104 and Regulation 40/94, superseded by but in this respect identical to Directive 2015/2436 and Regulation 2017/1001 (the EU Trade Mark Regulation), is exhaustive. Since lack of clarity is not in the list, it cannot be considered a ground for invalidity under EU trade mark law [par. 58-60].

The CJEU further held that trade mark registrations allegedly lacking clarity cannot be attacked on the basis of the requirement of graphic representation and compatibility with public policy, since those grounds of invalidity do not apply to the types of cases the referring court had in mind [par. 67]. In this respect, it parted ways with AG Tanchev, who had suggested that trade mark registrations lacking sufficient clarity might be contrary to public policy.

At the end of this part of the decision, however, the CJEU suggested a solution: a trade mark "registered for a range of goods and services designated in a manner which lacks clarity and precision is, in any event, capable of being protected only in respect of the goods and services for which it has been put to genuine use" [par. 70]. Thus, the CJEU seemed to indicate that, after expiry of the five-year period within which the trade mark must be put to genuine use, trade marks lacking clarity can be revoked insofar as they have not been put to use.

On its face, the solution offered by the CJEU to the problem of unclear and potentially overbroad trade mark specifications sounds reasonable. But the way this Kat reads it, it raises quite a number of new issues that will require sorting out in future decisions. Thus, it may fall short as an immediate solution to the problem of unclear trade marks.

Only trade marks subject to use requirement

To start with, the solution only helps for trade marks that have become subject to the use requirement of Article 18 EU Trade Mark Regulation. Thus, for a period of five years following registration of a trade mark for a term like "computer software", the trade mark proprietor shall in any event be entitled to "a monopoly of immense breadth which cannot be justified by any legitimate commercial interest of the proprietor" as the referring court put it [par. 171].

That is particularly worrisome where trade marks are "evergreened", i.e. re-registered after expiry of the five-year term. To be sure, the European Union Intellectual Property Office (EUIPO)'s Board of Appeal has recently ruled that such a re-registration, if "manifestly intended to circumvent the obligation to prove use of earlier marks", can be made in bad faith [R 1849/2017-2, par. 82, covered by The IPKat here]. But this line of case law is still being developed and it is not clear that it will always be possible for defendants in infringement suits to rely on it. 

Similar, not identical (Source: author's cats)

Partial revocation: "coherent subcategories" and similar goods

But even for trade marks that are subject to the use requirement, important questions remain.

According to the EUIPO's Trade Mark Guidelines, "great care must be taken" when assessing claims for partial revocation on the basis of non-use of part of the claimed goods. They cite a EUIPO Board of Appeal decision [R-1857/2011, here], where the trade mark AQUOS was registered for angling articles, equipment and accessories. The trade mark, however, had only been used for "fishing rods" and "fishing lines", which were subcategories of the broader specification. Consequently, the trade mark was only upheld for "fishing rods" and "fishing lines", but invalidated for "angling articles", "angling accessories" and "angling equipment" more generally.

The Board of Appeal held that where a broad registration is capable of being divided into sub-categories that can be viewed independently, particularly in relation to their intended use, the trade mark can only be upheld for those sub-categories for which the trade mark was actually used [par. 17]. In the decision in Sky, the CJEU seemed to have something similar in mind.

One may wonder, however, how this relates to Article 9(2)(b) of the EU Trade Mark Regulation, which grants protection against use of an identical or similar sign in relation to goods or services identical or similar to those for which the trade mark is registered. In the Board of Appeal case just discussed, would the AQUOS trade mark still offer protection for goods "similar to" fishing rods, even though the trade mark was not used for those similar marks?

If not, then the trade mark holder's protection ex Article 9(2)(b) EU Trade Mark Regulation would be substantially reduced after five years, i.e. to goods identical to those for which they themselves used the trade mark.

If, on the other hand, protection extends to products similar to fishing rods, the question arises what the purpose is of the "coherent subcategories" doctrine. After all, under the CJEU's broad test for similarity of goods as set out in C-39/97 Canon, most of the goods that fall under the general specification "angling equipment" will be at least somewhat similar to "fishing rods". Thus, even after partial revocation, the scope of protection would effectively remain "angling equipment".

Functional definitions of coherent subcategories

Furthermore, problems may arise when defining the relevant coherent subcategories. According to the Board of Appeal in AQUOS, "the criterion of the purpose or intended use of the product is of fundamental importance in the definition of a sub-category of goods" [par. 17]. But this can be easier said than done, as the example of "computer software" cited by the referring court illustrates.

For instance, McAfee is a well-known provider of antivirus software and services and, in Europe, holds the MCAFEE trade mark, registered inter alia for "computer software" in class 8. What are the coherent subcategories that can be split off on the basis of its use of the trade mark for its antivirus software?

McAfee offers antivirus software for Windows-, Mac-, iOS- and Android-compatible devices. Does that mean antivirus services for Linux-based operating systems must be excluded from the mark? That would seem overly restrictive. Somewhat more contentious, but in this Kat's opinion still debatably within the scope of the use, would be security coding into other software, e.g. products that make servers more resistant to hacks.

One can also look at the functionality of the software. Thus, the coherent subcategory may be any software that provides some protection to a computer system. But then what about software with different functionality but extra security features, such as "safe browsers": are those a separate coherent subcategory? This Kat is not so sure.

Conclusion

From a systematic point of view, the CJEU's decision in Sky is convincing: it would rather infringe legal certainty if the CJEU had recognized a non-enumerated absolute ground for invalidity for lack or clarity, or stretched the graphic representability or public order requirements to fit it in. The price to be paid for all this, however, is that there is still no solution to the problem of "unclear" trade marks that was rightfully raised by the referring court. This post has suggested that the solution the CJEU seems to offer has clear drawbacks.

Perhaps the best way forward is for trade mark offices to be stricter when it comes to terms like "computer software" at the time of registration. If such registrations may not be challenged after grant, perhaps good office practice may at least prevent them from being granted in the first place. In addition, as against marks like SKY that consist of actual words, the descriptive use defence in Article 14(1)(b) EU Trade Mark Regulation may offer solace. Otherwise, the waiting is for the next decision by the CJEU on how to best tackle the issue.